A simple guide to investing your first $500 + MORE Jan 24th

For many young Canadians, the barrier to entry for investing feels impossibly high. Between student loans, rising rent, and the cost of living, scraping together a starter fund can seem daunting. Yet, as little as $500 to $1,000 is sufficient enough to begin building the habits that create long-term wealth.

When you have a limited budget, every dollar has to work harder. The margin for error is slimmer, and the overwhelming number of financial products, from ETFs to individual stocks, can lead to analysis paralysis. Experts say there is no bulletproof way to stock pick in the early stages. Instead, focus on structure, simplicity, and consistency.

Pick the right home for your money

Before browsing the stock market, young investors need to decide where their money will live. There are a number of options including the tax-free savings account (TFSA), registered retirement savings plan (RRSP), first home savings account (FHSA), or an unregistered account. 

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Diandra Camilleri, associate portfolio manager at Verecan Capital Management Inc…

Retirement planning seems to involve waging a battle between the extremes of running out of money before you run out of life, or running out of life before you run out of money. The latter possibility rarely seems to occur to people but was aptly described by FIRE blogger Bob Lai of Tawcan in a recent blog on the topic of finding a balance between spending and saving: What if you run out of life?

Or, as U.S. retirement guru Wade Pfau recently put it, “A retirement income plan should be based on planning to live, rather than planning to die.” The Michael James blog recently highlighted that quote.  

Retirement is usually about planning for unexpected longevity, often exacerbated by inflation. After all, a 65-year-old Canadian woman can expect to live to 87—but there’s an 11% chance she’ll live to 100. 

That fact was cited by Fraser Stark, President of Longevity Retirement Platform at Toronto-based Purpose Investments Inc., at a September presentation to the Retirement Club, which we described this past summer…